How Atlanta’s Incentive Programs are Attracting Businesses from Across the Country

Author: Re'Nauta Bell

Categories: Atlanta Market News,Expectations,Market Insights,My Posts

Atlanta is a city that is quickly emerging as a leading destination for businesses. It’s not hard to see why. With its diverse economy, highly educated workforce, and supportive business community, Atlanta offers a wealth of opportunities for companies that are looking to grow and succeed. In this article, we’ll explore some of the reasons why businesses should consider moving to Atlanta, and the various incentive programs that are available to them.

A Diverse Economy

One of the key advantages of Atlanta is its diverse economy. Unlike many other cities that rely on a single industry, such as finance or manufacturing, Atlanta has a broad range of industries that contribute to its economic success. Healthcare, education, technology, transportation, and logistics are just a few of the sectors that are thriving in the city. This diversity helps to insulate Atlanta from the ups and downs of individual industries, making it a more stable and resilient place for businesses to operate.

A Highly Educated Workforce

Another factor that is attracting businesses to Atlanta is its highly educated workforce. The city is home to a number of prestigious colleges and universities, including Emory University, Georgia Tech, and Georgia State University. These institutions are producing highly skilled graduates who are eager to join the workforce and make a positive impact on the business community. In addition to this, the city’s large population means that there is a wide pool of talent available for businesses to draw from.

A Supportive Business Community

Atlanta also has a supportive business community that is committed to helping companies succeed. The Metro Atlanta Chamber of Commerce, the Atlanta Business League, and the Georgia Department of Economic Development are just a few of the organizations that offer resources and assistance to businesses. This includes everything from networking events and business development programs to access to capital and assistance with site selection. With such a robust support system in place, businesses that choose to move to Atlanta can be confident that they will have the tools and resources they need to thrive.

Incentive Programs

Of course, the decision to relocate a business is not one that is taken lightly. Companies need to carefully consider factors such as cost, workforce availability, and regulatory environment when deciding on a new location. Fortunately, Atlanta offers a range of incentive programs that are designed to make the transition as smooth and cost-effective as possible. Some of the most popular programs include:

The Job Tax Credit: This program provides tax credits to businesses that create new jobs in Georgia. The credit can be as much as $4,000 per job created, and can be used to offset up to 50% of a company’s Georgia state income tax liability.
The Quality Jobs Tax Credit: This program provides tax credits to businesses that create high-paying jobs in Georgia. The credit can be as much as $5,250 per job created, and can be used to offset up to 100% of a company’s Georgia state income tax liability.
The Retraining Tax Credit: This program provides tax credits to businesses that provide training to their employees. The credit can be as much as $1,250 per employee per year, and can be used to offset up to 50% of a company’s Georgia state income tax liability.
The OneGeorgia Authority: This program provides grants to businesses that are located in rural areas of Georgia. The grants can be used to fund a range of activities, including land acquisition, building construction, and job training.
The Georgia Quick Start Program: This program provides customized training to new and expanding businesses in Georgia. The training is tailored to the specific needs of the business, and is provided at no cost to the company.

When it comes to the cost of living, Atlanta is also a great choice for businesses. The city has a relatively low cost of living compared to other major metropolitan areas, which makes it an attractive location for employees as well. This can help businesses to attract and retain top talent without having to pay exorbitant salaries.

Atlanta offers a wide range of benefits for businesses that are looking to grow and succeed. Its diverse economy, highly educated workforce, and supportive business community make it an ideal location for companies that are looking to expand their operations. And with a variety of incentive programs available, including tax credits, grants, and training programs, there has never been a better time to consider relocating to Atlanta.

Additionally, Atlanta’s central location and transportation infrastructure make it an ideal hub for businesses that need to move goods and services across the country. The city is home to the world’s busiest airport, Hartsfield-Jackson Atlanta International Airport, which provides non-stop flights to over 150 domestic and international destinations. It’s also located at the intersection of three major interstates, which allows for easy access to the rest of the Southeast region.

Whether you’re a startup or an established company, Atlanta provides a wealth of opportunities for growth and success. By taking advantage of the city’s resources, incentive programs, and skilled workforce, businesses can position themselves for long-term success and make a positive impact on the local community.

Apr 20 No Comments

Seize the Moment: Tenants Have Leverage

Author: Re'Nauta Bell

Categories: Atlanta Market News,Commercial Lease,Expectations,Market Insights,My Posts

The commercial real estate market has been experiencing high vacancy rates in office buildings, largely due to changes in work culture and the rise of remote work. This shift presents a unique opportunity for tenants to leverage the current market conditions in their favor. In this blog post, we’ll explore 4 ways tenants can capitalize on high vacancy rates to negotiate better lease terms and secure the ideal office space for their needs.

Understanding the Current Market Landscape

Before diving into negotiations, it’s essential to have a clear understanding of the current market conditions. High vacancy rates can be attributed to several factors, including:

Increased remote work: More companies are embracing remote work, reducing the need for physical office space.
Economic factors: Economic fluctuations can impact the demand for office spaces as businesses scale back or expand their operations.
Oversupply of office space: Some markets may have an abundance of available office space, resulting in high vacancy rates.

Identifying Negotiation Opportunities

With a clear understanding of the market landscape, tenants can identify areas where they have leverage in negotiations. Some possible negotiation opportunities include:

Lower rental rates: High vacancy rates can put pressure on landlords to reduce rental rates to attract tenants and fill their empty spaces.
Greater concessions: Landlords may be more willing to offer concessions, such as free rent periods, tenant improvement allowances, or flexible lease terms, to secure a tenant.
Improved lease terms: Tenants may have more room to negotiate favorable lease terms, such as rent escalation clauses, renewal options, and termination rights.
Prime locations: With increased availability, tenants may have access to office spaces in more desirable locations that were previously unattainable.

Preparing for Negotiations

To maximize their leverage during negotiations, tenants should:

Do their homework: Research the market and gather information on comparable properties, rental rates, and vacancy rates. This data can be used as a benchmark during negotiations.
Establish clear objectives: Determine your priorities and what you hope to achieve in the negotiation. This can include securing a lower rental rate, obtaining specific concessions, or negotiating favorable lease terms.
Engage a tenant representation broker: A knowledgeable broker can help tenants navigate the market, identify opportunities, and advocate on their behalf during negotiations.

The Art of Negotiation

When it comes time to negotiate, tenants should keep these strategies in mind:

Be assertive but fair: Use your research to justify your requests and demonstrate that you understand the market conditions.
Focus on win-win outcomes: Aim for agreements that benefit both parties, as this can lead to a more successful and long-lasting tenant-landlord relationship.
Be flexible and adaptable: Be prepared to adjust your priorities and make concessions if necessary, while still striving to achieve your objectives.

The current high vacancy rates in office buildings present a valuable opportunity for tenants to secure favorable lease terms and conditions. By understanding the market landscape, identifying negotiation opportunities, and employing strategic negotiation tactics, tenants can effectively leverage the current market conditions to their advantage. Engaging a tenant representation broker can further enhance a tenant’s negotiating power and ensure they secure the ideal office space for their needs.

Apr 13 No Comments

Navigating the Waves: How the Fed’s Rate Hikes Impact the Atlanta CRE Market

Author: Re'Nauta Bell

Categories: Atlanta Market News,Expectations,Market Insights,My Posts

The Federal Reserve’s recent rate hikes have sent ripples throughout the economy, with the commercial real estate market being no exception. As a tenant representation broker in Atlanta, I’ve witnessed firsthand how these rate hikes have affected the local commercial real estate landscape. In this article, we’ll explore the implications of the Fed’s rate hikes on the Atlanta commercial real estate market and offer insights for businesses and investors looking to stay ahead of the curve.

Understanding the Fed’s Rate Hikes

The Federal Reserve raises interest rates to combat inflation and maintain economic stability. While these rate hikes are essential for long-term economic health, they can have short-term effects on various sectors, including commercial real estate. Here are some ways the rate hikes impact the commercial real estate market:

Increased borrowing costs: Higher interest rates make borrowing more expensive, which can affect commercial property development, acquisition, and refinancing.
Capitalization rate changes: As interest rates rise, the required return on real estate investments may also increase, leading to changes in capitalization rates and property values.
Shift in demand: Higher interest rates may cause some businesses and investors to be more cautious in their real estate decisions, potentially impacting the demand for commercial properties.

The Atlanta Commercial Real Estate Market Amidst Rate Hikes

While the rate hikes have created challenges, the Atlanta commercial real estate market has shown resilience. Here’s how the market has been affected and adapted:

Development projects: While some developers may delay projects due to increased borrowing costs, others may move forward with well-planned developments to capitalize on Atlanta’s growing population and business opportunities.
Office space demand: Despite the rate hikes, Atlanta’s thriving business environment continues to attract companies seeking office space, particularly in areas like Midtown, Buckhead, and the Central Perimeter.
Industrial and logistics sectors: The rise of e-commerce and the need for efficient supply chain solutions have bolstered demand for industrial and logistics properties in the Atlanta area, providing a buffer against the impact of rate hikes.

Strategies for Navigating the Changing Landscape

To thrive in the evolving Atlanta commercial real estate market, businesses and investors should consider the following strategies:

Evaluate financing options: With higher interest rates, it’s crucial to explore various financing options and secure the most favorable terms possible for property acquisitions, development, or refinancing.
Focus on fundamentals: In uncertain times, it’s essential to focus on the fundamentals of commercial real estate investments, such as location, property quality, and tenant creditworthiness.
Engage a knowledgeable broker: Partnering with an experienced tenant representation broker can help businesses and investors make informed decisions, identify opportunities, and navigate the complexities of the current market conditions.

While the Fed’s rate hikes have introduced new challenges for the Atlanta commercial real estate market, the city’s thriving business environment and diverse economic landscape have helped to mitigate their impact. By understanding the implications of the rate hikes, adapting to the changing landscape, and employing strategic approaches, businesses and investors can continue to find success in Atlanta’s commercial real estate market.

Apr 06 No Comments

The 5 Ways CRE is Evolving

Author: Re'Nauta Bell

Categories: Atlanta Market News,Expectations,Market Insights,My Posts

As a commercial real estate broker specializing in tenant representation in Atlanta, I’ve had the unique opportunity to witness the changing dynamics of office spaces as businesses reevaluate their needs. In recent years, there has been a growing trend towards businesses seeking less traditional office space and repurposing existing spaces to accommodate new work models. This shift has had a significant impact on the commercial real estate landscape, and in this blog post, I will explore how these changes are influencing the market and share insights on how businesses can navigate this new terrain.

Factors Driving the Shift Towards Less Office Space

Several factors are contributing to businesses reassessing their office space requirements:

Remote work: The rapid increase in remote work opportunities and the widespread adoption of flexible work arrangements have allowed businesses to reduce their physical office space.
Cost savings: By using less square footage, companies can save on rent, utilities, and other associated costs, allowing them to reallocate funds to other critical business functions.
Changing workforce preferences: As younger generations enter the workforce, they often prefer a more flexible work environment, which may not necessarily include a traditional office setting.

The Rise of Co-working Spaces and Flexible Work Environments

To adapt to these changes, many businesses have turned to co-working spaces and flexible work environments. These options provide businesses with the flexibility to scale up or down according to their needs, without the long-term commitment of a traditional lease. Additionally, co-working spaces often come with added amenities and services that can enhance the employee experience, such as meeting rooms, event spaces, and a collaborative atmosphere.

Repurposing Office Space: Creativity and Innovation

Repurposing existing office spaces can be an excellent solution for businesses looking to adapt to the changing landscape. Some innovative ways companies are repurposing their office spaces include:

Creating multi-use spaces: Businesses can optimize their square footage by creating versatile spaces that serve multiple functions, such as conference rooms that can be easily converted into breakout areas or lounge spaces.
Prioritizing collaboration: Open-concept floor plans and shared workspaces can encourage collaboration and communication among team members, fostering a more dynamic work environment.
Incorporating wellness elements: Integrating wellness-focused design elements, such as green spaces, natural light, and exercise facilities, can help promote employee well-being and productivity.

Navigating the New Commercial Real Estate Landscape

As a tenant representation broker, my role is to help businesses identify their ideal office space solutions amidst these changes. Here are a few tips for businesses looking to navigate the new commercial real estate landscape:

Assess your needs: Take a close look at your current office space and identify what works well and what can be improved. Consider your future growth plans and how your space needs may change.
Explore your options: Investigate the various office space options available in the market, including co-working spaces, flexible lease terms, and repurposed office spaces.
Seek professional guidance: Engage with a tenant representation broker who can help you navigate the market, negotiate lease terms, and provide insights on the best office space solutions for your unique needs.

The commercial real estate landscape is continually evolving to accommodate the changing needs of businesses. By staying informed and adapting to new trends, businesses can make informed decisions and create office spaces that support their employees’ needs, foster productivity, and contribute to their overall success. As a commercial real estate broker and blogger, I am committed to helping businesses in Atlanta make the most of this dynamic market.

Apr 12 No Comments

Useable vs Rentable Square Feet

Author: Re'Nauta Bell

Categories: Education,Expectations,My Posts

DO I NEED TO KNOW THE DIFFERENCE?

Being able to make sense of usable vs rentable square feet is vital for knowing how much space you are really going to get when you rent an office for your company. Knowing the difference between usable square feet and rentable square feet can mean all the difference in evaluating the best deal on a commercial lease. Office space is generally listed with a rentable square footage rate, which includes more square feet than the actual space the tenant will occupy. Having this knowledge will also help you ensure that you are getting the best possible deal on an office space and that you have an accurate idea of how much space you will be getting.

USEABLE SQUARE FEET

Let’s talk about useable square feet. The usable square feet of a space is defined as the total area unique to the tenant. Think of it as the space specifically set aside for your company’s use. Once you walk into your suite, the area inside is considered usable square feet. The calculation of this number will be slightly different for tenants leasing a full floor vs tenants leasing a partial floor. For a partial floor lease, this includes all office space plus any storage areas or private restrooms unique to your suite. It also includes space taken up by things like columns or recessed entries.

RENTABLE SQUARE FEET

Rentable square feet. Let’s talk about it. So what is rentable square feet? A commercial office building is not made up of private offices and cubicles alone. Corridors, meeting spaces, lobbies, stairways, restrooms and so on are used by all building tenants, and landlords charge for the use of this space as well. Rentable office space includes the usable square feet of the office space plus a pro-rata share of building common areas. Pro-rata means that tenants pay for these common areas in proportion to the amount of space they lease in the building.

CALCULATE RENTABLE SQUARE FEET

So how do you calculate the rentable square feet? To calculate rentable square feet, landlords use what is called a load factor (also called a common area factor, or an add-on factor). They use the load factor to figure rentable square feet for individual tenants. This number is based on the percentage of common areas found in the building. If a building has a total square footage of 100,000, with 85,000 usable square feet. This would leave 15,000 square feet of common areas and the load factor would equal to the rentable square feet divided by the usable square feet, or 1.15.

The formula for calculating load factor goes just like this:

Building Rentable Square Feet ÷ Building Usable Square Feet = Load Factor

So that would be, in this example,: 100,000 ÷ 85,000 = 1.15

This load factor is then multiplied by the individual tenants’ usable square feet to come up with the total rentable square feet. If a company desired to lease 5,000 usable square feet, for example, this number would be multiplied by the load factor of 1.15 to reach the number of rentable square feet:

The formula is as follows:

Tenant Usable Square Feet x Load Factor = Tenant Rentable Square Feet

5,000 usable square feet x 1.15 = 5,750 rentable square feet.

The rentable square foot amount would then be multiplied by a rental rate to come up with the company’s total annual or monthly rent.

Knowing this formula helps companies to evaluate their best deal for office space. Suppose a company compared two 5,000 usable square foot office spaces with the same rental rate from two buildings with load factors of 1.15 and 1.20.

5,000 usable square feet x 1.15 = 5,750 rentable square feet

5,000 usable square feet x 1.20 = 6,000 rentable square feet

In the first building, the rent would be based on 5,750 square feet, whereas the second building would charge rent based on 6,000 square feet. The building with the lower load factor would save the company significant money.

On the other hand, the company may decide that the extra money is worth the larger, fancier lobby, or more spacious kitchenette. It could be the company’s best decision to value the amenities more than the extra cash. The important thing is for companies to do a little math and figure out exactly what they are paying for in order to make intelligent decisions about value.

Load factors, often represented as a percentage, commonly range between 10% and 20%. Often a partial-floor tenant will pay a floor common area share as well, in order to pay for use of the floor’s corridors and bathrooms, etc. The landlord will calculate the tenants usable square feet times the proportion of space the tenant occupies on the floor to come up with a floor rentable square feet figure; that number is then also multiplied by the building’s load factor.

Now you have a little extra insight into commercial real estate and how those square footage figures you see in office space listings are actually calculated. Ideally, when you are looking for a new office, you will be working with a commercial real estate broker who will be able to walk you through issues like this, but it is always smart to be informed and aware. Also note that if you see the abbreviation USF, that stands for usable square feet, and the abbreviation RSF stands for rentable square feet.

Mar 08 No Comments

Crash Course – Commercial Real Estate 101

Author: Re'Nauta Bell

Categories: Atlanta Market News,Expectations,Market Insights,My Posts

“What is commercial real estate?”

Commercial real estate is an industry that is not necessarily widely known and promoted. Because of that, when some people hear the term real estate, they automatically think of a residential property. Most likely, the reason for this is because much of the population has either directly or indirectly experienced facets of the home-buying experience. On the surface, they may seem similar, but there are many, many differences between commercial real estate and residential real estate. Let’s talk about some of them. Welcome to your crash course – Commercial Real Estate 101.

“The main difference is…”

A property that provides a living space is considered residential real estate. On the flip side, a property that is exclusively used for business-related purposes with the intention of generating income, is considered commercial real estate. Commercial real estate is segmented into different niches to include retail, industrial, land, multi-family, mixed-use developments, and office. The performance of commercial property, including sales prices and new building rates, are often used as a measure for business activity in a given market or submarket.

“What is retail real estate?”

Retail properties are used to market and sell consumer goods and services. They range from shopping centers to individual stores and pop-up shops to big box stores like Saks Fifth Avenue and JCPenney.

“What is industrial real estate?”

An industrial property is a property that is used for the actual manufacturing of something. It can either be considered a factory or plant. These building types are usually zoned for light, medium, or heavy industrial. This includes uses such as warehouses, garages, and distribution centers.

“What is land real estate?”

Land is real estate property, less buildings and equipment, which is designated by fixed, spatial boundaries. Land ownership might offer the titleholder the right to any natural resources that exist within the boundaries of their land.

“What is multi-family real estate?”

A multi-family property is any residential property that contains more than one housing unit to include duplexes, townhomes, apartment buildings, and condominiums. These are some of the most common examples.

“What is mixed-use real estate?”

Mixed-use properties or developments combine residential and non-residential buildings. They can be a single building, multiple buildings, or an entire neighborhood. Mixed-use developments provide ample access to community amenities and foster community involvement.

“What is office real estate?”

Lastly, we have office real estate, which is what I focus on. Office properties are occupied for a variety of different purposes. Office users can engage in retail enterprises, services businesses, non-profit organizations, technology firms, etc. Office can refer to entire buildings, a floor, parts of a floor, or office parks such as Concourse Office Park in Atlanta, GA featuring the King and Queen towers. Office buildings are categorized by their height.

“How is a building defined by its height?”

An office building has less than 7 stories above ground level is classified as a low-rise building. An office building that has between 7 and 25 stories above ground level, is classified as a low-rise building. An office building that has more than 25 stories ground-level building, is classified as a high-rise building. Office buildings are further categorized by class.

“What is building class?”

Class A – Building classes range from A to C and are determined based upon the physical and locational aspects of building. Class A properties tend to accommodate users who need high-quality finishes and materials to attract a specific employee or customer. The building is normally located close to amenities and prestigious areas.

Class B – With class B properties, they tend to be more functional and probably will be highly efficient. They will be nice but cost-effect and sometimes building age considered when classifying a building. If the building has high-quality finishes but the design is kind of dated, the building could be considered a Class B.

Class C – Class C Properties have physical, functional, and economic obsolescence. They tend to be in less desirable areas they may not look very pretty, however, they normally have lower risk and can accommodate start-ups that need lower occupancy costs.

Jan 03 No Comments

What Can a Tenant Representation Broker Do For Me?

Author: Re'Nauta Bell

Categories: Expectations,My Posts,Protection

Need Office Space? No problem.

If you are seeking commercial office space to lease for your business, hiring a skilled tenant representation broker is the way to go. With a tenant representation broker, you will find that many of the difficulties associated with finding commercial space will be alleviated. A good tenant rep broker will find you the office space that meets your companies needs while paying attention to your bottom line. Read on to find out what a tenant representative can do for you:

#1 Offer Industry Insight

During the search or the negotiation process, you might have some questions to ask about choosing the ideal office space and what makes the most sense for you. A tenant representation broker will enlighten you on areas where you hold leverage as well as areas where the landlord may not budge on negotiations. This knowledge comes from handing several transactions in your respective market.

#2 Help You Establish Your Needs

With some experience in the bag, tenant representatives know the right questions to define what kind of office space will be ideal for your company. After a meeting with your tenant rep broker, you may find that your primary idea of a perfect office might not be the best fit for your company after all.

#3 Explain Your Market

It is challenging to determine whether you’re getting a fair deal from a landlord if you don’t have an accurate understanding of the market. A tenant rep broker can provide you with data to help you see how an offer measures up against current market rates in the area.

#4 Tell You About Pocket Listings

Many office spaces are not advertised to the general public. Landlords need tenants so they tend to have good relationships with tenant reps. This direct connection to the landlord can help you gain access to places that you may not have considered or had access to on your own. Experienced tenant brokers are familiar with the tenants in the buildings located in their sub-markets and know those who are not renewing their leases. This insider knowledge could afford you the option to snag a great and sought-after space.

#5 Have the Right Connections

A lot of tenant rep brokers have existing relationships with space planners, interior designers, and real estate attorneys and can help you with referrals for capable professionals whose services you may need in the future. If you have a good tenant rep, they may help you manage some level of the build-out stage.

#6 Help You Win Leverage

When you have a tenant representative beside you on the table, you’ll have an extra advantage during the negotiation process. The tenant rep broker will argue in favor of your company and help you engage the prospective landlord. They will make sure you get favorable concessions and make sure all business terms are correct in the final lease draft. A broker can also point to you the right time to agree or when it would be better to walk away from a deal.

#7 Help You Read the Fine Print

Commercial leases are very complicated, long documents, filled with things you might not understand properly. Lease drafts tend to be very landlord-centric and, sometimes, can be outright ridiculous. On your own, you may not understand this fact but a tenant rep broker can read the fine print and see clauses that could be problematic in the future. In addition, they can explain in simple terms what the lease agreement entails before you sign the agreement preventing you from making a poor business decision that could affect you for years.

#8 Not Charge You A Penny

The tenant representative’s fee is taken care of by the landlord, not your company. Because of this, you can enjoy all the benefits of having one on your team during the search and negotiation process without altering your budget. It’s a win-win for you!

#9 Security

In conclusion, having tenant representation is truly essential in securing good office space for your business. It also will create security in lease negotiations. The tenant representative helps you identify hidden opportunities in the market and make your search easier. With all of this said, doesn’t it make sense to hire a tenant rep broker? What do you have lose? A lot if you go about your commercial real estate search without representation.

Photo courtesy of the Atlanta Business Chronicle

Nov 01 No Comments

Renewing Your Lease? Consider This First

Author: Re'Nauta Bell

Categories: Commercial Lease,Expectations,My Posts,Protection

Need to Renew?

Renewing a lease can be a pretty overwhelming and complex situation for corporate tenants who are accustomed to simply doing their job and not worrying about real estate. While that’s tough, it’s also a way to learn what the current market is doing and how the current position of your business can determine whether you can negotiate better lease terms moving forward.

When you truly understand your options during a lease renewal negotiation, you can be a force to be reckoned with. A tenant representation broker will arm you with market knowledge that you may not otherwise be privy to, help you to negotiate a lower rate, acquire additional amenities, and secure the best deal possible for your business.

Read on to find out more way you can ensure a good deal for your business as well as how you can protect your future commercial real estate ventures.

Negotiate Early…It Only Makes Sense

When considering a commercial real estate lease renewal, it is always best to be proactive. Evaluate your situation, determine what is and is not working for your business, and communicate with your landlord 9-12 months before your lease agreement expires. Your landlord will consider these points while reviewing your renewal and will be well aware that time is on your side – time for you to look for a new space if your concerns are not fairly considered.

In the event that you don’t have time, I’ve got you covered. What I just described is the best-case scenario, however, I have closed Class A office space deals within the span of a business week so I know it can be done. If you have a tenant representation broker who is “Johhny on the spot” and is as “quick as lightning”, then you’ve got a great teammate fighting for you. That kind of broker will alert the landlord upfront that “time is of the essence” and the deal needs to close fast. If the landlord is on board, you’ve got a great situation in front of you and even greater representation behind you.

What’s Going On With Your Current Space?

Before making any sudden decisions, take the time to analyze how your business is performing in its current commercial space. This is an opportunity to determine if the space is still suitable for your company and its future growth. Items to consider are location, amenities for employees, office configurations, and tech-enabled infrastructure. These can all serve as discussion points in the negotiation of your renewal. There is a possibility that your current landlord may incur these costs if it means keeping your company as a tenant. When you determine these factors, you can really increase your market knowledge which will facilitate an opportunity for you to have more leverage in negotiation.

Understand the Market Conditions

The commercial real estate market is dynamic, resulting in continuous changes year after year. It is important to be up-to-date on the current state of the market when looking to sign a new commercial lease or renew your current lease. Look at the market around you; are the rents similar to what you are currently paying for space? Are there other properties that offer additional benefits? Having this knowledge gives you the ability to be well informed while negotiating your current lease. If there is the potential to have some of these added benefits, lease renewal is the time to present them to your landlord.

Once you are more knowledgeable about the current market conditions, ask your tenant representative to negotiate an option or two for you. The market changes every year so it would best serve you to lock in a good rate for as long as you can. If it costs too many dollars for the same thing you had last year, it doesn’t make sense. Don’t you agree?

Research Alternative Options

Even if you are comfortable in your current commercial space, it is always beneficial to educate yourself on other buildings and owners in the market. You may determine an opportunity that is a better fit for your company. Availabilities, rental rates, and amenities have probably changed since you were last in the market, so it is worth the time to look at your options. During your research, you will become more knowledgeable about the commercial real estate market. Whether you stay in your current space or sign another commercial lease, this information can benefit your negotiation process.

Work with a Commercial Real Estate Broker to Negotiate

Do not underestimate the importance of using a broker to help you negotiate your commercial real estate lease renewals. In addition to sharing their market expertise, tenant representation brokers are always aware of the current market conditions, opportunities, owners, and other brokers. They provide you with leverage to get the incentives that you and your business deserve and have a genuine interest in seeing you win. Tenant reps know how important the right office space is for your business. An experienced broker can add value to your commercial lease renewal process, negotiate any required terms, and answer any lease related questions.

Oct 04 No Comments

Moving Your Offices? Contact a Professional

Author: Re'Nauta Bell

Categories: Expectations,My Posts,Protection

You are a successful business owner and everything is booming in your world.

Your current location has been good to you but your client base has grown dramatically. The past few years have afforded you a great proof of concept but you know you could offer your clients more. You know you need a new atmosphere and better location to best serve your clients. Where do you start? How do you accomplish that?

It sounds like you a need a tenant representation broker. A broker will find you a great new space and negotiate you a killer deal. That sounds simple enough, right? Let’s delve in a little deeper. Read on for your “no-cost-to-YOU” solution for getting a better space.

#1: YOU are the first priority

A tenant rep will have great relationships with many landlords and listing brokers. As a result, this will lead to a smooth transaction for you. Tenant representation brokers work on your behalf. They have no obligation to landlords or the buildings they present. It is their legal, fiduciary responsibility to you to evaluate buildings, locations, and leases without any bias. Additionally, they will not promote one building over another. Tenant representatives will work to position your deal in the marketplace. They will also leverage the best possible transaction both qualitatively and quantitatively. They will help your bottom line.

#2: Evaluating commercial real estate is a full-time career

In order to accurately identify lease opportunities, significant time and work goes into the process. This is time that you, like many professionals, don’t have to spare. Tenant representation brokers will determine your unique office needs and engage the market. They will analyze all alternatives and negotiate terms. Ultimately, they will find you an office space that meets your business needs. This process will ensure that you make the proper real estate decisions while paying attention to your operations.

#3: We focus on what we know so you can focus on what you do

Rather than taking time to educate yourself on the commercial real estate market, a tenant representation broker will do that for you. They can manage everything from needs assessments, parking requirements, zoning restrictions, and as well as establishing timelines and the lease execution. The decisions you make now will impact the efficiency, productivity, and profit of your organization. A tenant representation broker is sensitive to that.

#4: Tenant reps help you to determine what’s best

Defining and analyzing your business objectives will help you determine what you need in your office space. A tenant representative will apply consideration to your budget and future growth. Do your projections include expansion? Do your employees need to be near public transit? Do you need all offices on glass? Is walkability a major factor for your business model? A tenant representation broker will know all of the right questions to ask. This will help to determine the right commercial space for you.

#5: Tenant representatives have numerous resources…seriously

Searching for new space on your own can be frustrating. It is difficult to get an accurate idea of what’s available in the commercial real estate market. Many websites that have out-of-date or incomplete information. It may even be hard to get a listing broker to call you back! A tenant representative will have the most inclusive list of commercial real estate options in the market. Tenant reps have access to exclusive commercial real estate databases, industry relationships and knowledge of off-market options. This enables tenant reps to give you a variety of quality options that may not be possible to acquire on your own. If you don’t believe me, try calling a few numbers on the “For Lease” signs and see how things go. You’ll see that I’m right!

#6: Tenant Representatives will handle negotiations

Going through the negotiation process can be overwhelming. Having a tenant representative who knows the market and is exclusively representing your interests is important. They understand the need to capitalize on timing and market conditions. They will apply negotiation techniques to create the most leverage on your behalf. This will help you receive the best lease terms possible without the stress of negotiating alone. Lastly, they know the tricks of the trade which will help you.

For instance, if the market price for milk is $3.06 per gallon, you will pay $3.06 for that gallon of milk from the grocery store. If you are a vendor, you could go directly to that distributor and negotiate a much lower price point. As a vendor, you have more negotiation power. Distributors deal with vendors. HMOs deal with doctors. Landlords deal with tenant representation brokers. It’s as simple as that. Landlords will always negotiate with tenant representation brokers on your behalf. They do so because they trust the tenant rep to qualify their client before bringing them to the space. This saves the landlord a time by not having to qualify the prospective tenant upfront.

Tenant representatives can get you a ton of other incentives. Some include free rent and a break on the rental rate. They may even be able to get you more concessions!

How Much Is It Going to Cost Me?

On a final note, remember when I said you can get your space at no cost to you? Let me clarify! Tenant representation services are free because the landlord pays your representation for you. I know that sounds super crazy but that IS how this crazy thing works. The landlord sets aside a budget for representation when he/she acquires a commercial property. Whatever that budget is, is typically split down the middle. Half goes to the landlord’s representation and the other half goes to the tenant’s representation.

Why would a landlord do such a thing, you ask? A landlord is willing to pay a tenant rep’s commission because he/she feels confident that they are bringing a viable tenant to their establishment. They are willing to pay for that. I know it’s weird and I don’t make the rules…I just play by them. If you are looking for office space, I’m more than happy to point you in the right direction. I hope you found this helpful!

Sep 16 No Comments

CRE Conflict – An Important Consideration

Author: Re'Nauta Bell

Categories: Expectations,My Posts,Protection

CRE Conflict - An Important Consideration

Resist the Urge

You are driving in your car and you see a “For Lease” sign on the building. You happen to be in the market for space and you want to call for more information. Logically, that makes the most sense, however, the phone number you see is for the building owner’s representation. If you do not have your own representation, the situation can quickly become unfavorable for you. You are one of the lucky ones if you DO know you are dealing with the competition but, unfortunately, many business owners aren’t even aware of the conflict in the first place. They simply see a desirable building and call the number none the wiser. Resist the urge to call the number on the “For Lease” sign. Instead, take down the number and the broker’s information and give it to you tenant representation broker.

This is when the tenant representative rides in on the white horse and forsakes all landlord allegiances to represent only the tenant in commercial real estate transaction. Tenant representation has taken root in corporate America, where space users seek out tenant-only brokers and tenant-only brokerage firms have grown in response to this demand.

Get Exclusive

Tenant representation brokers are commercial real estate brokers who work exclusively for the tenant and never represent the landlord. The tenant representative role developed in response to the conflicts of interest that were, and still sometimes are, rife in the industry. They are now a universally embraced, specialized sector of commercial brokerage, with a broader range of services focused on the unique needs of a tenant such as space planning, construction management, lease renewal consulting, site search, financial analysis and strategic negotiations.

Risk of Conflict

There is a very real risk of working with a broker who has blatant conflicts of interest. It is in your best interest to be intentional when searching for a broker who only focuses on tenant representation. In the old model, the landlords and their brokers held all the cards. The tenants were merely a means to an end. With the advent of tenant representation, the industry is waking up to the reality that the tenants actually hold all the cards, because the tenants pay the rent. In truth, landlords are utterly dependent on the rent tenants pay as their sole source of income. Unfortunately, many tenants don’t realize they hold all the cards and have all of the power. A good tenant representation broker will enlighten you on the leverage you actually do have.

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